July 23, 2009

Central bank: Canada’s recession is over

Canada is ahead of the world in emerging from the recession, but still faces hurdles, the central bank said in Ottawa Thursday.

In summarizing the report at a news conference, Canada's central bank Gov. Mark Carney said the country's recovery was progressing as the bank forecast in April.

The bank has long expected that economic growth in Canada would resume in the second half of this year and pick up in 2010. Indeed, growth in Canada should resume this quarter, Carney said.

He said elsewhere in the world, the recovery was nascent as reforms are rolled out.

Global economic activity appears to be nearing its trough, and there are increasing signs that activity has begun to expand in many countries in response to monetary and fiscal policy stimulus and measures to stabilize the global financial system, Carney said.

The governor said minor revisions have been made to April's forecast, including that the Canadian economy will contract by 2.3 percent this year and then grow by 3 percent in 2010 and 3.5 percent in 2011.

One of the unsettling factors in recovery is the stronger and more volatile Canadian dollar, Carney said.